~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ The Finance Pillar in Home Health Care Six Things You Can Do to Improve the Bottom Line April 30, 2008 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ In this issue... -- Six Steps to Improve the Financial Performance of Your Home Health Agency -- Improve Your Financial Performance with Better Insurance Coverage -- Sales Certification for Home Health Care Professionals -- The Academy for Private Duty Home Care in Maryland -- New BLOG Postings on the Home Health Care Leadership Minute -- About the Author -- Permission to Reproduce Welcome, . . . to Stephen Tweed's Leading Home Care Report, the premier online newsletter for CEOs and executives of America's leading home health care agencies. (For strategies and insights on how to grow your Private Duty non-medical home care business, we invite you to subscribe to Private Duty Today, our newsletter for non-medical home care.)

Six Steps to Improve the Financial Performance of Your Home Health Agency ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Cash flow is a challenge right now for some home health agencies. The new PPS process has caught some agencies off guard and they're not getting paid. What about you? I was in Dallas last week speaking at the Southwest Regional Home Care Conference, and in Indianapolis yesterday speaking at the Indiana Association for Home & Hospice Care conference. In both states, I heard home health executives saying they were having some difficulty getting paid by Medicare. In most cases, the problem is not with Medicare or their fiscal intermediaries, but with their own systems for filing claims. I got an interesting reaction from some folks when I stood on the platform during my Home Health Care 2020 keynote speech and said, "This is the best economic period in the history of home health care." They looked at me like I had two heads. And yet I believe that is true. Yes, there are some hiccups in the current reimbursement system, but you'll learn how to work with the system and get back on track. But more home health agencies are making more money than ever before in the history of home health care. If you aren't, here are six things you can do to improve your financial performance: 1. Review and Revise your Medicare PPS processes. You remember when PPS started in October of 2000. It took a while for agencies to learn the process and learn how to make money under the new system of reimbursement. Over the past 8 years, over 60% of home health agencies were able to earn a profit from their Medicare business, and home health care has flourished as a result. More patients are getting more care and better care than any time since BBA '97 and the interim payment system. If you weren't making money on Medicare in 2007, shame on you. Now, it's time to review and revise your internal procedures to make sure that your agency is doing all of the steps to comply with the New PPS, and to make sure you are getting claims out on time, collecting receivables, and tracking results. It will take a while, but there is still a wonderful opportunity. 2. Provide in-depth training for your nurses and therapists on OASIS and the New PPS process. Never before have your nurses and therapists been in such a powerful position to influence the revenue coming into your agency. The decisions they make on the OASIS assessment and in designing their plans of care will have a huge impact on revenue and profitability. If you have not provided intense training for your field professionals, start right now. 3. Increase Your Case Mix. In January we presented a three part teleseminar on Sales & Marketing Strategies for PPS Performance. It was designed to help your sales and marketing team understand the implications of the new PPS, and how they can refocus their efforts to bring in more patients with higher levels of acuity, which increases your overall case mix and therefore your revenue per episode. We're not talking about "cherry picking" patients, but we are talking about focusing your resources to serve those patients with the greatest need, and those patients that fit your agency's clinical strengths. And, those patients whose diagnoses account for higher case weight. (You can still order a set of the audio CDs from this live teleseminar on Sales & Marketing Strategies for PPS Performance. ) 4. Manage Your Payer Mix. Everyone we talk with in home health care is finding that the most profitable payer is Medicare. They are working aggressively to avoid Managed Care, and most state Medicaid programs have low reimbursement rates. What a switch from the mid 1990's when every home health agency in America was wondering how to get more managed care business. You can improve your payer mix by working with your sales and marketing team to focus their efforts on the right referral sources. Then, you need to develop a clear message for those referral sources about the importance of the mix of referral sources. If you have a referral source who is giving you all of their MCO business but no Medicare patients, what do you say? How do you deal with them? First, you need to know the numbers. Then, you need to craft the message. And finally, you need to back up the message with a clear policy about what patients you will and will not take, and why. Our Mission is to serve patients and our communities, but you can't do that if you don't survive economically. You know my saying, "You must first do well before you can do good." 5. Improve your Gross Margins. Gross Margin is the % of revenue that is left after you subtract the direct cost of providing care. That means, your direct costs of putting nurses and therapists in the field, such as wages, salaries, benefits, taxes, travel costs, and supplies. In home health care, the most effective way to improve gross margins is to improve the productivity of your entire field team. It begins by looking at the total number of visits per episode. Then it means increasing the number of visits or productivity points per day of your nurses and therapists. Having clear productivity measures and policies is critical. Then you need to train and coach your clinicians to be more productive. You can't improve productivity by "whipping the horses." You have to help them develop new skills and new pathways to get better outcomes in fewer or shorter visits. 6. Develop a Scorecard to track and communicate financial performance. You're getting tired of hearing me say it. "What gets measures gets managed. What gets rewarded gets repeated." There. I said it again anyway. To improve the financial performance of your agency, you need a simple scorecard to track your results monthly and to communicate those results with your home health team. When your people really know the score and understand how they can contribute, they'll help you improve your profits.

Improve Your Financial Performance with Better Insurance Coverage ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ On a regular basis, I get calls or emails asking about insurance coverage for home health care. The questions may have to do with health insurance for workers, professional liability insurance for the agency, or auto insurance to cover liability for field staff who might be involved in an auto accident. We also get lots of calls about liability and insurance coverage for transporting clients or patients. For a long time, I passed on answering those questions because I didn't know much about insurance. Then, I met David Dickie, President of The Solutions Group in San Antonio, Texas. I learned that David specializes in insuring home health agencies and private duty home care companies. I began to give callers David's name when they asked for insurance help. I became a David Dickie fan when I got this email back from a caller: "Stephen, Thank you so much for recommending David Dickie for our insurance needs. We will save 62% this year on our liability policy and we have more coverage than our original policy! Thank you again! Beth M. Hullinger Operations Manager Trinity Home Health Care Now, I refer all of those questions to David. We've not accepted advertising or sponsorships in The Leading Home Care Report, but we decided to begin accepting Sponsorships when David asked if he could be a sponsor and have an article in the newsletter. My son, Jason, sat down with David Dickie, President of The Solutions Group, to discuss some questions that we often receive here at Leading Home Care. He asked David to share the answers to these common questions. What is a typical home health agency liability insurance package? "A comprehensive package includes the following coverage: · Professional Liability: Provides liability protection in the event of damage to a client while providing services in connection with your operations. · General Liability: Provides liability protection in the event of an occurrence arising out of your organization's operations: Bodily Injury and/or Property Damage Personal Injury and Advertising Injury Fire & Water Legal Liability Hazard. · Hired & Non-Owned Auto Liability: Provides liability coverage to protect your organization from loss arising out of the use of a non-owned vehicle being operated by an employee of your organization while conducting official business. (Non-owned vehicles are typically the vehicles of your nurses, caregivers and clients)." Tell me more about the coverage available for transportation of a client. "We provide non-owned auto coverage that extends to damage to a client while providing transportation services. Transportation services must be as an adjunct to a caregiving relationship; we cannot cover public livery in our non-medical program." Agencies often advertise 'Insured & Bonded'. What is 'Bonded' referring to? "Bonding refers to commercial crime coverage designed to respond to claims of theft from a client's home by an employee. Extending coverage to a client's home requires a special endorsement to the standard bond; agencies need to make sure that they have the proper coverage." If you'd like to learn more about The Solutions Group, we've added a web page about their company to our website. It also has contact information if you'd like to get in touch with them directly. To learn more about how to improve your insurance protection, visit The Solutions Group

Sales Certification for Home Health Care Professionals ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ One of the big challenges facing home health care executives who want to grow their businesses is finding and training sales representatives. Our research shows that the number two most effective and most frequently used technique for bringing in referrals that turn into admissions is "Direct Selling", having feet on the street calling on physicians and other referral sources. If you are serious about growing your home health agency in 2008, then you need to look at your sales process, and at the training and coaching of your sales representatives. Sending sales reps out into the field to make calls without training and coaching is like sending nurses into the field to care for patients before they have completed their nurses training. You'd never do that. To solve that problem, Leading Home Care has teamed up with Decision Health, publishers of Home Health Line and Private Duty Insider, to offer our Certified Home Care Sales ProfessionalTM workshop. This program is designed specifically for sales professionals working with home health agencies. (The Certified Private Duty Sales ProfessionalTM workshop that we ran two weeks ago in San Antonio was designed specifically for those selling non-medical home care. We'll repeat that program again in 2009.) The Certified Home Care Sales ProfessionalTM This certification is designed specifically for sales professionals representing Certified Home Health Agencies, calling on hospitals, physicians, and other skilled care facilities. This workshop is designed specifically for those selling home health care. We have also had participants from hospice, medical supply companies, home medical equipment, and home infusion pharmacies. The Certified Home Care Sales ProfessionalTM June 11, 12, 13, 2008 - Charlotte, NC September 17, 18, 19, 2008 - San Antonio, TX Join Dr. Tray Dunaway, Michael Giudicissi, and myself for two and one half days of high-impact sales training, and earn the CHCSP designation. See you in Charlotte or San Antonio. Register today!

The Academy for Private Duty Home Care in Maryland ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Many of you who are leaders of Home Health Agencies also have a Private Duty Home Care business. If so, you're probably looking for new ideas and information to grow that business and increase its profitability. If you're on the East Coast, you'll want to consider sending your Director of Private Duty to The Academy for Private Duty Home Care being held in Columbia, Maryland on Wednesday, June 4, 2008. Sponsored by the Maryland-National Capital Home Care Association, this one-day program will cover sales and marketing strategies, and recruiting and retention techniques to grow your non-medical home care business. Based on significant research that began in 2003, The Academy for Private Duty Home Care has been designed as a one-day institute expressly for CEOs and owners, administrators, sales and marketing staff, financial and personnel officers, and other senior staff of Private Duty Home Care companies. This is your opportunity to come together in an intimate, high-impact learning environment to share strategies, ideas, and insights on how to grow your business, multiply the performance of your team members, and increase your income. Objectives: As a result of this intimate, high-impact learning experience, leaders in Private Duty Home Care will be able to: Put the Three Key Elements of a successful Private Duty Home Care business into practice. Implement a focused sales & marketing plan to ensure a steady flow of clients. Develop specific action plans for immediate and long term growth. Find and keep the caregivers you need to grow your business and serve your clients. Develop and implement your Personal Private Duty Scorecard. Plan now to attend: June 4, 2008 - Columbia, Maryland 8:30 a.m.-4:30 p.m. The Handelman Learning Center The Beacon Institute, Inc. 10280 Old Columbia Road, Suite 215 Columbia, MD 21046 410-381-2401 Register Today for The Academy for Private Duty Home Care

New BLOG Postings on the Home Health Care Leadership Minute ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Here are the most recent postings on our BLOG at the Home Health Care Leadership Minute: Telehealth as a Sales & Marketing Tool in Home Health. Home Health Care and Nursing Homes duke it out over Medicaid dollars." Technology Trends in Home Health - Wireless in Spain. Linking Technology to Improve Quality and Clinician Performance. High Tech Home Care Camera lets you peer into your own cavities. Click here to visit our BLOG

About the Author ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Stephen Tweed, CSP, is Chairman and CEO of Leading Home Care ... a Tweed Jeffries company. For nearly 25 years he has been a recognized leader in strategy and leadership development for home care companies and associations. He is the author or co-author of five books, four of which were written specifically for the home care industry. He has served on the boards of directors of three not-for-profit home care agencies, and has served as interim President & CEO of a $25 million homecare company. Stephen is a past-President of the National Speakers Association, a 3500 member international society of experts who speak professionally. He is also the father of a 37 year-old son who is physically disabled and uses the services of home care on a daily basis. Meet the entire Leading Home Care Team

Permission to Reproduce ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Permission is granted to healthcare publications, associations and companies to reproduce this article in your publication, or to distribute copies to your leaders, on the condition that you reproduce the credits and contact information as follows: "Reprinted with permission from Stephen Tweed's Leading Home Care Report. Copyright 2008 Stephen C. Tweed. To receive a FREE subscription to this newsletter, log on to www.leadinghomecare.com."

Contact Leading Home Care ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ email: stephen@leadinghomecare.com phone: 1-866-209-5101 web: http://www.leadinghomecare.com ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~